The health insurance industry has been continuously evolving over the past 170 years, but many of the changes we’ve seen have been incremental in shifting the focus to wellness. During the next 20 years, however, we expect to see a transformational change as existing silos are broken down and the health care sector transitions from a model based on treatment to a model focused on wellbeing and prevention.
The concept of health insurance has changed significantly since 1850 when the Franklin Health Assurance Company of Massachusetts provided coverage for travelers who were injured in railroad and steamboat accidents.1 But the changes we see on the horizon for health plans could significantly alter the existing business model—and health plans should begin preparing for the future.
The Deloitte Center for Health Solutions recently conducted crowdsourcing research with 28 health care, policy, and tech experts to get a sense of what the health plan of tomorrow might look like. Members of the crowd generally agreed that disruption in the market is inevitable. They expect change to accelerate as health plans tap into multidimensional data. Health plans of the future will rely on new data streams and to ensure they receive high-quality care when needed. While data and data interoperability will likely be the secret sauce for this new model, consumers will own their data—and they might be unwilling to share with health plans unless they see value in return.
Business as usual might not be an option
The business model for most health plans today is built around claims processing and risk management. Our experts described a future in which health plans will focus on the care and wellbeing of their members—and rely on multidimensional data to accomplish this. Health plan products will balance traditional population-level risk with being hyper-personal and easy-to-understand, based on consumer need. Moreover, health plans will have learned how to use digital devices and other tools to engage with consumers and direct them toward better health.</p?
As the entire health care industry transforms, Deloitte’s research found that health plans should focus on one or more of three fundamental roles that can drive value:
- Wellbeing and care delivery. If health plans are to assume the role of steward to members’ wellbeing, they should work more closely with care delivery teams. This could present opportunities for plans to manage health and become localized health hubs that enable the delivery of consumer-centered care models.
- Care enablement. New business models can move beyond claims processing to instead focus on enabling member wellbeing and care. This shift could lead to new product lines.
- Data and platform. Using the wealth of data they possess, companies can develop new revenue streams based on consumer insights, monetization of data, population health initiatives, and customized offerings.
Some health plans are already beginning to move to more consumer-focused business models. Here’s a look at some of the early movers we are seeing:
Anthem Inc.: The Blues plan operator launched its “Engage” tool in 2017. The integrated digital platform allows members to create a personalized experience. Engage integrates benefits information with the member’s clinical and claims data. The tool is also able to pull wellness data from members’ health and wellness apps. In addition, Engage provides price comparison tools to help members make better cost and quality decisions about their health care.2
WellCare of Connecticut: In 2017, the Connecticut subsidiary of WellCare Health Plans, Inc. partnered with Boston-based Iora Health to deliver “relationship-based care” to its Medicare Advantage (MA) members. Iora, which primarily serves the Medicare population, developed its own consumer-focused electronic health records (EHR) system, the Collaborative Care Platform (dubbed Chirp). Chirp helped Iora transition from an EHR system that gathered patient information solely for billing and coding to a system that more accurately documents a patient’s story. Iora says the customized platform allows it to more effectively manage and coordinate care. Chirp was also designed to help clinical teams care for patient populations. The system includes applications to help manage tasks and to emphasize patient communication. It also has a mobile-friendly, patient-facing portal. WellCare said the collaborative care platform was integral to the decision to work with Iora.3
UnitedHealth Group: The health plan operator recently partnered with DexCom, a manufacturer of glucose-monitoring systems, and Fitbit, the wearables maker, to provide real-time aid to their diabetic members. People participating in the pilot program received personalized diabetes coaching to help them understand and act upon the data gathered by both the devices. Together, these devices are empowering members to more effectively manage their health.4 The health plan operator expects the program will help improve adherence and reduce the use of medication in populations with this chronic illness. In addition, during an earnings call last October, UnitedHealth Group CEO David Wichmann told investors that the company intends to give 50 million members access to a “fully integrated and fully portable” EHR. Along with medical information, members would receive the “next best action detail” for maintaining or improving their health.5
Oscar Health: Customers are asked a few personal questions online to help them choose the most appropriate coverage option. Information that is important to the customer is displayed in easy-to-understand language. This approach helps ensure that customers aren’t overwhelmed with too many options or coverage details that could cause them to give up. Oscar also provides members with financial incentives for meeting fitness goals. Each member receives a fitness band that tracks physical activity and sleep patterns and sets individualized fitness goals.6
Our research predicts that the next transformation for health plans will occur as the health care industry transitions from a focus on acute events and chronic illness to using data-driven precision insights to decrease acute events and address illness early. Greater emphasis on wellness and identification of health risks early could result in fewer—and less severe—diseases. Our expert participants suggest that health plans should now consider boosting operational efficiencies and increasing the value they offer to plan sponsors and members. These changes might also help incumbent players partner with, or compete against, a wave of companies that are beginning to disrupt the health care system.
Over the next 20 years, the health care system overall, and health plans specifically, will undergo tremendous transformation. Given that the changes ahead appear imminent, the time is likely now for health plans to reevaluate their existing business models and decide how to get ready for the changes ahead.
For more on our vision for the future, visit our resource hub where you’ll find articles, videos, podcasts, and more.
1 Monthly Labor Review, The development and growth of employer-provided health insurance, March 1994
2 Business Wire, Anthem Blue Cross to launch integrated digital benefits and health engagement platform, October 19, 2017.
3 PR newswire, WellCare of Connecticut and Iora Health announce partnership to improve care and outcomes of WellCare Medicare members, Business Insider, September 6, 2017; Iora Health, The birth of Chirp: Why we built our own electronic health record, June 2016
4 Digital Trends, Managing Type 2 diabetes gets easier thanks to UnitedHealthcare and Dexcom, January 18, 2018; HIT Consultant, UnitedHealthcare, Dexcom launch wearable glucose management pilot, January 12, 2018
5 UnitedHealth Group third-quarter 2018 earnings call transcript, October 2018
6 Oscar Health home page; Wired, Health care is broken. Oscar Health thinks tech can fix it, August 14, 2018